Sports sponsorship is no longer decided on the whim of a company chairman. As Martin Croft discovers, where once it was driven by corporate objectives, it now has to justify its budget and extend into other areas of the marketing mix

SBHD: Sports sponsorship is no longer decided on the whim of a company chairman. As Martin Croft discovers, where once it was driven by corporate objectives, it now has to justify its budget and extend into other areas of the marketing mix

Why do companies sponsor particular sports? Had you asked that question ten years ago, most people in the know – be they marketers or sponsorship consultants – would have given much the same answer: because the chairman likes golf/yachting/racing…

Ask the question now and the answer is rather different. As Andy Owen of direct marketing consultancy The DMO observes: “Because of the pressure there has been on budgets over the past few years, people are thinking `I can’t go for sailing just because I happen to like it – I’ve got to look at my target audience.’ People are asking `who are the consumers that are into my product, and what sports are they interested in?”

The DMO, although not a sponsorship consultancy, was responsible for bringing together the Daily Star and the greyhound racing industry, after analysis of the Star’s target audience and the kind of punter who watches greyhound racing revealed an almost perfect match.

“The profile of the Star’s readership and that of greyhound racing was so close it was almost scary. The greyhound audience was almost completely compatible with the sort of people the Star wanted to reach. It’s a good fit, and it’s a good use of its marketing budget,” says Owen.

Of course, a few years ago, marketers would never have been able to access the sort of information they need to per-form that sort of analysis without huge expenditure on custom -built market research.

Now the recent growth of lifestyle databases means that information on which consumer groups are interested in which sports, and what their purchasing and behaviour patterns are in other key areas, is readily – and relatively cheaply – available.

Previously, the choice of sports sponsorship was very much the prerogative of the chairman, managing director or head of corporate affairs. In many companies, that has changed. Sports sponsorship, indeed, all sponsorship, is much more closely integrated with other marketing activities.

Advertising, promotions, direct marketing, public relations and sponsorship now feed off each other to create a synergistic whole which is greater than the sum of the parts. At least, that’s what those active in the market would have you believe.

John Wilkins is head of the sponsorship research unit at Research Surveys. His department was set up in the early Eighties and has been tracking the success of sports sponsorship since then.

According to RSL’s figures, there were about 800 sports sponsorship deals involving UK companies last year, with an estimated value of £265m. That includes both deals which were struck in 1994, and multi-year deals which were already in place. Sports sponsorship has a two-year cycle, Wilkins says. In every even-numbered year, there tend to be two huge international events which will boost the sponsorship budget; in 1996, these will be the Atlanta Olympics and the European Football Championships. In odd-numbered years, however, there is usually only one event of any significance. This year, it is the Rugby World Cup.

Wilkins recalls: “In the mid-to-late Eighties, most sponsorship was driven by corporate objectives and the sort of research companies were asking for was relatively unsophisticated. They measured success in terms of things like column inches in the press. As time went by, they had to justify their sponsorship budget more and more, and they couldn’t simply follow the chairman’s whim any longer. Sponsorship is now controlled in most cases by the marketing department, and it is looking for information on how it has reached its target audience, whether by geodemographics, age or behaviour patterns.”

He admits, ruefully, that RSL has lost clients because its research has shown its sponsorship is not reaching the right consumers. “A company cancels its sponsorship, the only sponsorship it did, and so it doesn’t need sponsorship research any more.”

Nigel Geach, associate director of Sports Marketing Surveys, agrees with Wilkins that pressure on budgets, brought about by the recession of the early Nineties, has forced clients to be more responsible and sophisticated about their sponsorship budgets. He says: “There is increased research into whether sponsorship is delivering. If someone put £X into golf, they want to make sure they are getting through to the right people. A lot of the work we do now is pre-evaluation: looking at events, checking the demographics of the people who watch the sport or participate, then matching the profile against the target market for the product. More and more, today’s sponsorship will have been evaluated in advance.”

Geach also stresses that sponsorship no longer exists in a vacuum – at least, with the more sophisticated users. It will be integrated with the rest of the marketing mix. He asks: “If Carling puts £Xm into sponsorship, how much more will it spend on tied-in promotions?”

This point is endorsed by Matthew Patten, client services director of sponsorship consultancy Orbit International. In his opinion: “Certainly the top fmcg companies are much more sophisticated about use of sponsorship. They have a long-term view: it has to have a strategic rationale. It has to be extendible into other areas of the marketing mix, because they will be using it to drive other activities such as direct marketing, sales promotion and above-the-line advertising. They are even looking at how it fits in with interactive media.”

Patten claims that if the clients aren’t using sophisticated research techniques, such as Mosaic profiling or lifestyle databases, to analyse their sponsorship, then the sponsorship consultancies are. “There’s much more of a planning function, in the advertising agency sense, to sponsorship these days.”

Chris Lovell, managing director of agency Lovell Vass Boddey, admits that his company has in the past run clients’ databases against the lists held by lifestyle companies such as NDL to find out what the fit for a particular sport is. “If a marketing manager asks if it is a good idea to get involved with a particular sports sponsorship activity, we can find out how it fits with the profile of their audience. It’s very cheap to do, considering how much major league sponsorship can cost. Plus sponsorship is notoriously difficult to measure in terms of success.”

Certainly The DMO used the names and addresses it gathered from the Star’s sponsorship of greyhound racing to build up a database of consumers which could be analysed, and perhaps more importantly, targeted for further direct marketing.

Geoff Mayhew is publicity manager of insurance broker Cornhill, which has been sponsoring test match cricket for the past 17 years. He denies that the company’s original involvement with cricket was in any way due to a senior management whim. He says: “We had a very clear objective when we went in to sponsorship – just as we do with any other marketing objective.”

This objective was to build awareness of Cornhill, which 17 years ago was unknown by the UK public. An awareness level of two per cent at the start of its sponsorship has grown to slightly more than 20 per cent, Mayhew claims. He adds: “If you’re talking about multi-million pound deals, then I don’t think even a member of the board would sling money into something that didn’t deliver.”

Cornhill recognises there has been a change in the 17 years since it started its cricket sponsorship. As Mayhew admits: “Sponsorship doesn’t exist on its own any more. It has to be fully integrated into all the other marketing activities a company is doing.”

Last year, Cornhill ran a Fantasy Cricket League promotion in conjunction with the Daily Express. Mayhew says that Cornhill Direct, the company’s direct sales operation, has been using this as a focus of its list-building activity. The Fantasy League “gave us a database of Daily Express readers, which we have since tested to see if it is viable for direct marketing purposes – and it is.”

Fiona Foster, a director of consultancy Karen Earl, which advises Cornhill, says that the fit between cricket and Cornhill’s requirements, in terms of the audience it wants to reach, is almost perfect. “The spectator profile of cricket is heavily ABC1, with a 75/25 male/female ratio. The spread fits their requirements exactly.”

Foster believes that companies have to establish what their objectives are before they get involved in a sponsorship deal, and then make sure that they assess the situation on a year-by-year basis, to ensure that they are meeting their objectives.

Given the size of some of the sponsorship deals which are being discussed at the moment, it is hardly surprising that clients will want to know where their money is going. Clifford Bloxham is client services director for Advantage International UK. He says the company now employs far more people on the corporate sponsorship side than on its original core business, the representation of individual athletes such as Steffi Graf. Most of the companies Advantage deals with are looking for a sports marketing plan, Bloxham claims.

“The client starts off by saying we think sponsorship makes sense, but we don’t know how to fit it in with our existing marketing efforts. They give us their criteria, and we come up with a plan which shows them whether sport will work for them, and which events it really makes sense for them to back.”

In order to create such a plan, it is essential that Advantage has access to up-to-date in-depth research on various sports, the different events which happen during the year and their audience, whether televised or attending in person, and the profile of the marketer’s target audience.

Advantage’s US parent company is currently acting on behalf of eight of the 12 US sponsors for the Atlanta Olympics, advising them on how to integrate their Olympic sponsorship with all their other marketing programmes.

It sounds like they need the advice. As Bloxham says: “When you buy most sponsorship, you get a package of set benefits – signage, your logo in event advertising, perhaps corporate hospitality. When you sponsor the Olympics, all you get is the right to use the rings in your promotions and the right to buy hospitality. For $40m, that’s all you’re getting. Unless you create your own programme around it, you won’t get any benefit.”

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